Archer Aviation Q1 2026 Earnings Report

Archer Aviation EPS Results

• Actual EPS: -$0.28
• Consensus EPS: -$0.25
• Beat/Miss: Missed by -$0.03
• One Year Ago EPS: -$0.17

Archer Aviation Revenue Results

• Actual Revenue: $1.60 million
• Expected Revenue: $1.66 million
• Beat/Miss: Missed by -$64.00 thousand
• YoY Revenue Growth: N/A

Archer Aviation Announcement Details

• Quarter: Q1 2026
• Date: 5/11/2026
• Time: After Market Closes
• Conference Call Date: Monday, May 11, 2026
• Conference Call Time: 5:00PM ET

Archer Aviation (NYSE:ACHR), Inc. (NYSE: ACHR) is a California-based aerospace company developing electric vertical takeoff and landing (eVTOL) aircraft designed to serve as sustainable urban air mobility solutions. Founded in 2018 by Adam Goldstein and Brett Adcock, Archer focuses on the design, development and certification of zero-emissions air taxis aimed at reducing traffic congestion in densely populated metropolitan areas. The company’s flagship prototypes, “Maker” and “Midnight,” have been engineered to deliver quiet, efficient short-haul flights with ranges of up to 100 miles per charge.

Headquartered in Palo Alto, California, Archer operates a manufacturing facility in nearby Santa Cruz County and maintains research partnerships with automotive and energy companies, including a collaboration with Stellantis to integrate advanced battery systems. Archer’s aircraft feature a modular battery architecture, distributed electric propulsion, and a composite fuselage to optimize performance and safety. These technical innovations support a projected cruise speed of approximately 150 miles per hour and a low noise profile, positioning Archer as a leader in next-generation air mobility.

Archer has secured pre-orders and purchase agreements with major transportation and airline partners, most notably a strategic partnership with United Airlines to provide regional air taxi services in select U.S. markets. The company aims to launch commercial operations in key urban centers, leveraging its strong executive leadership under CEO Adam Goldstein and a team of experienced aerospace engineers and aviation specialists. By targeting airport-to-city and city-center-to-city-center routes, Archer seeks to establish a scalable network that addresses the growing demand for on-demand, point-to-point air travel.

As Archer advances through the certification process with the Federal Aviation Administration (FAA), the company continues flight testing of its prototypes at its private test facility in southern California. Archer’s development roadmap includes securing type certification for its production aircraft, ramping up manufacturing capacity, and expanding service offerings into new geographies. With a commitment to sustainability and urban infrastructure integration, Archer Aviation is positioned to redefine intra-city and regional travel with its electric air taxi ecosystem.

Archer Aviation Q1 2026 Earnings Call Transcript

Key Takeaways

• Positive Sentiment: Archer closed FAA phase 3 of type certification (first eVTOL to do so) and is advancing phase 4 in parallel, targeting piloted transition and entry into eIPP operations in the second half of the year.
• Positive Sentiment: Flight testing and operations expanded materially — multiple daily flights across an enlarged Midnight fleet and takeover/modernization of Hawthorne Airport in L.A. to serve as an air taxi hub and revenue-generating launch site.
• Neutral Sentiment: Archer reports a strong balance sheet with $1.8 billion in liquidity and <$100M debt, while guiding a Q2 adjusted EBITDA loss of $170M–$200M as it increases near-term investment across civil, defense, and software initiatives.
• Positive Sentiment: The company is pursuing a dual civil/defense flywheel — partnering with Anduril on a clean-sheet hybrid dual-use aircraft and with software leaders (Palantir, NVIDIA, Starlink) to develop AI/ATC capabilities that could unlock large market opportunities.
• Neutral Sentiment: Archer is building manufacturing capacity and tooling toward ~50 aircraft/year and working on production certification, but mass production remains contingent on final regulatory approvals and continued certification progress.

Presentation

[Operator]

I'll now hand the conference over to Kate Kiewel, Head of Investor Relations. Kate, please go ahead.

[Kate Kiewel, Head of Investor Relations at Archer]

Welcome to Archer's earnings call. This is Kate Kiewel, Archer's Head of Investor Relations. Today, we will be making forward-looking statements that are based on current assumptions. We don't undertake any obligation to update those assumptions as a result of new information or future events.

[Kate Kiewel, Head of Investor Relations at Archer]

Risks and uncertainties may cause our actual results to differ materially from those contemplated by these statements. For more information about potential risks and uncertainties, review the risk factors in our SEC filings. Today, we will also be discussing both GAAP and non-GAAP financial measures. A reconciliation of those measures is included in our earnings release from today. Now, I'll turn it over to Adam. Adam?

[Adam Goldstein, Founder and CEO at Archer]

Thank you and good afternoon. I want to start by stepping back because the opportunities unfolding across the aerospace and defense market right now are massive. The future is arriving all at once. The investments we are making across our civil, defense, and AI software businesses are forming a flywheel that increasingly reinforces itself. We are seeing that momentum unfold across the ecosystem.

[Adam Goldstein, Founder and CEO at Archer]

The U.S. government is leaning in. President Trump, the DOT, and the FAA delivered the eVTOL Integration Pilot Program last year, creating real-world testing environments for next generation aircraft. Recently, Archer was selected as a partner in three of the winning eIPP applications across eight states. We are on track to begin flying under that program in U.S. cities later this year.

[Adam Goldstein, Founder and CEO at Archer]

Simultaneously, this administration is targeting to deploy over $20 billion for ATC modernization, an investment that would unlock new levels of safety and throughput across the national airspace. Foreign governments are following suit. The UAE, Saudi Arabia, Korea, Japan, and numerous others are building infrastructure and accelerating regulatory pathways to position themselves at the forefront of this new form of transportation.

[Adam Goldstein, Founder and CEO at Archer]

The largest airlines worldwide are also recognizing this moment and stepping up. We already work with seven of them across our businesses, and our multi-billion dollar order book for Midnight continues to grow. The world's biggest stages are eager to showcase this future. We are collaborating closely with the L.A. 2028 Olympic Games, DOT, FAA, surrounding communities, and other stakeholders to plan our launch of air taxi operations as the official provider for the games.

[Adam Goldstein, Founder and CEO at Archer]

There will be millions watching as the future is being built in America. Let's focus on our air taxi progress. The reason we are positioned where we are today, a leader in the industry, traces back to the decisions that we made on day one. Archer's path to commercializing eVTOL has always been rooted in a first principles approach, designing a safe passenger-carrying aircraft purpose-built for rapid back-to-back trips of 20 mi-50 mi in urban environments at low cost with a low noise profile.

[Adam Goldstein, Founder and CEO at Archer]

When I entered this sector, most of the competitors had spent a decade cycling through configurations. Archer committed very early on to a partial tilt architecture designed for the air taxi use case and for FAA certification from day one. That discipline has compounded. Eight years in, no one else in the eVTOL industry has moved as fast as we have.

[Adam Goldstein, Founder and CEO at Archer]

While the majority of our team is battling day to day to get through the final phase of certification and bring this new mode of transportation to market, I am focused on ensuring we future-proof our ability to scale. A type certifiable design is not enough. It requires us to solve two additional challenges.

[Adam Goldstein, Founder and CEO at Archer]

The first key unlock is industrial scale. We need to continue pushing our entire industrial base forward here in the U.S., which will deliver meaningful cost and performance improvements with each new generation of Midnight. Advanced materials, new manufacturing processes, further advanced propulsion systems, and components built for volume production on the scale of autos. We have to prove out these innovations before the FAA will allow us to use them in commercially certified aircraft.

[Adam Goldstein, Founder and CEO at Archer]

We will deploy them first in autonomous attritable dual-use aircraft for cargo and defense, and then flow these technologies back to future iterations of Midnight, helping unlock step change improvements in cost and performance. This is just one example of how our three business lines compound on one another. The second key unlock is modernizing our national airspace. America's airspace today is a limiter on America's GDP growth, and we have to give it the ability to scale.

[Adam Goldstein, Founder and CEO at Archer]

While it can likely safely handle the additional traffic we expect over the next three to five years, the long-term scale of air taxis and AAM will require the U.S. to rework the infrastructure and software underlying air traffic control. The good news is this administration, and in particular, Secretary Duffy and Administrator Bedford, get this and are tackling it head-on.

[Adam Goldstein, Founder and CEO at Archer]

Today's system was not built for the volume or the kind of traffic that's coming over the next decade. This is why we've partnered with category-defining technology leaders, including Palantir, which was recently down selected as a finalist for the FAA's SMART program, as well as NVIDIA and Starlink, both of which will bring next generation capabilities to Midnight.

[Adam Goldstein, Founder and CEO at Archer]

We are focused on bringing the most innovative technologies to address the challenges we face. These are not adjacencies. They are the imperatives that will drive the flywheel, unlocking massive scale. They are years-long efforts. The time to invest is now, and the good news is we are already executing against all of them. Let me turn to how we executed this quarter. We had a banner quarter on certification.

[Adam Goldstein, Founder and CEO at Archer]

Archer became the first eVTOL company to close Phase 3 of the FAA's 4-Phase type certification process, and we have been advancing Phase 4 in parallel for some time now. Coupled with that exciting progress, this was also our most expansive quarter for our flight test program. With piloted VTOL and CTOL flights across our expanded Midnight fleet on a nearly daily basis, and often multiple times a day. This quarter, we also took over operations at Hawthorne Airport in L.A.

[Adam Goldstein, Founder and CEO at Archer]

We have begun modernizing it so it can serve as an air taxi and mobility hub for the city of L.A. and its surrounding communities, and as our innovation hub for the next generation airspace technology we are developing with our partners. On the defense side, our work with Anduril continues to accelerate. As I discussed in my letter to the shareholders, defense procurement is a performance and cost equation.

[Adam Goldstein, Founder and CEO at Archer]

You cannot retrofit your way into the right solution. You must take a first principles approach. Our partnership with Anduril is doing just that. We chose to partner with Anduril because, among other strengths, they deeply understand what the U.S. and its allies need in next generation of VTOL aircraft, beyond the legacy programs that have been entrenched for 50+ years.

[Adam Goldstein, Founder and CEO at Archer]

Together, we have designed and begun building our clean sheet hybrid aircraft, drawing on the technologies Archer has developed for Midnight and the IP we acquired from Karem, Overair and Lilium. The window for these decades-long programs of record are approaching fast, and we will be ready. I continue to be amazed by what our teams can do. I firmly believe the Archer Anduril team is one of the greatest aerospace teams of this generation.

[Adam Goldstein, Founder and CEO at Archer]

Top technical fellows from Boeing, former chief engineers from Lockheed, leading PhD researchers from Stanford. You only get a chance to be part of a team like this once. I believe our hybrid dual use autonomous aircraft will be the most sophisticated vertical lift platform ever developed in its category. It is not incremental, it is generational. When people see what we have built, they will recalibrate their beliefs about what America can field. I cannot wait to show it off. Stay tuned.

[Adam Goldstein, Founder and CEO at Archer]

Archer is now a multi-threat company. We expect to start initial air taxi operations in U.S. cities, begin winning phased government defense awards, and begin to deploy our AI solutions later this year. We are executing from a position of strength with $1.8 billion in liquidity. I've never been more confident in what Archer is building or more proud of the team building it. With that, I'll turn it over to Priya.

[Priya Gupta, Interim CFO at Archer]

Thanks, Adam, good afternoon, everyone. I'll now take you through the key financial highlights for the quarter and provide our guidance for Q2. We continue to maintain a very healthy balance sheet with $1.8 billion in liquidity, one of the strongest positions in our sector. With less than $100 million in debt, our liquidity is clean, flexible and fully available to fund our strategic priorities without the overhang of significant leverage. Our spend for Q1 came in on guidance, a reflection of the rigor and intentionality we bring to every capital allocation decision.

[Priya Gupta, Interim CFO at Archer]

As discussed in our last call, and in line with the updates Adam shared today, this planned increase in our spend directly correlates to the opportunities we are seeing across civil, defense and software, and the platforms we are building in each of those areas that we believe will allow us to capture a meaningful portion of the market. Our revenue for Q1 began to grow as we expanded operations at the Hawthorne Airport in L.A. We expect this revenue to increase in Q2 as we continue to progress our plans to modernize that airport and its operations.

[Priya Gupta, Interim CFO at Archer]

Looking ahead, as we advance our commercial readiness with Midnight's expanded flight test program and operations under the eIPP and in L.A. make advancements in the design, development and build of our next generation hybrid autonomous aircraft platform and advance our AI software platform, we expect to slightly increase our investments for the quarter. For Q2, we estimate our adjusted EBITDA loss to be in the range of $170 million-$200 million.

[Priya Gupta, Interim CFO at Archer]

This expansion of our investment reflects our level of conviction in the multi-billion dollar opportunities in front of us, not a deviation from discipline. We believe our multi-platform strategy is what separates Archer from the field. Our liquidity gives us the strength to execute it. With that, I will turn it back over to the operator.

[Operator]

We will now begin the question and answer session. Please limit yourself to one question and one follow-up. If you would like to ask a question, please press star one to raise your hand. To withdraw your question, please press star one again. We ask that you pick up your handset when asking a question to allow for optimum sound quality. If you are muted locally, please remember to unmute your device. Please stand by while we compile the Q&A roster. Your first question comes from the line of Andres Sheppard from Cantor Fitzgerald. Your line is now open.

[Andres Sheppard, Analyst at Cantor Fitzgerald]

Hey, everyone. Good afternoon. Thank you so much for taking our questions, and congrats on all the great progress so far. Adam, for the first question, I wanted to touch on maybe defense and autonomy. It's sounding more and more that this is gonna be a big focus for Archer going forward. Just curious if you could maybe give us a bit more color there. What kind of opportunities might you be pursuing or are you excited about to the extent that you can talk about it? How should we think about defense and autonomy for Archer going forward? Thanks.

[Adam Goldstein, Founder and CEO at Archer]

Thanks, Andres. I'm going to let Tom answer that question to go through some of the defense opportunities. As you might recall, I've explained in the past, Tom has been leading the defense platform while Benjamin has been really pushing hard to get the Midnight platform through certification, but I'll turn it over to Tom.

[Tom Muniz, CTO at Archer]

Yeah. Hey, Andres. Well, Adam touched on some of the themes earlier in the call, just to kind of like recap how we can get them out defense. Going back to the beginning of Archer, it was all about building towards a mission and taking a first principles approach. You know, Midnight was optimized around this mission of moving people in and out of cities. It's optimized for low cost, high safety, low noise, and obviously designed bottoms up for certain manufacturing. Initially, we looked at if we could use a version of Midnight for defense. You know, we did work with the Air Force over the years, and there might be some niche applications there.

[Tom Muniz, CTO at Archer]

For the significant opportunities, the ones with the largest need that we're targeting now, like you can't expect to modify Midnight and have that function well for this different mission. It just doesn't make sense. As we've said, we're developing a clean sheet new aircraft that's a hybrid vehicle, partnering with Anduril. Again, we've taken this first principles approach for that aircraft, but it's obviously optimized around a different mission.

[Tom Muniz, CTO at Archer]

This dual use mission we're looking at has very specific payload, speed, range, cost targets, obviously quite different from Midnight. I can't get into the details on any of those numbers, but we're now like pretty far into the development of this vehicle, and I'm confident it's going to be a pretty incredible machine.

[Tom Muniz, CTO at Archer]

Based off of, you know, that progress and what we've seen from some of the customers that we're targeting, we've got a really strong conviction and optimism that our aircraft is going to be selected for some of these very large opportunities that are coming up in defense. Our goal is to show that aircraft later this year and ultimately win some of these phased down-selects this year. Super exciting time.

[Andres Sheppard, Analyst at Cantor Fitzgerald]

Wonderful. Got it. That's super helpful. I appreciate all that color. Maybe just as a quick follow-up, I'm curious if we can get an update on piloted transition flight. Any updates there, or when should we be targeting it? Thank you.

[Benjamin Lyon, President of Aircraft OEM at Archer]

Yeah, Andres. This is Benjamin. Thanks for the question. Like we were saying, you know, we're already very much in the midst of our piloted VTOL test campaign, and we've been rapidly expanding our cadence. We're flying multiple aircraft multiple times a day. Really the focus right now is on progressing and advancing through more and more complex test points ahead of full transition.

[Benjamin Lyon, President of Aircraft OEM at Archer]

Really central to that is the software verification and validation, which requires a higher level of rigor for piloted operations. We're working through that methodically and we're confident in the timeline. Just a little bit more color on that, we've moved through the hover regime, which is that first phase, faster than any prior phase.

[Benjamin Lyon, President of Aircraft OEM at Archer]

This is the fastest we've progressed from a first flight through this point in a test campaign and also with the fewest issues. We're not too far away, but it'll be in the second half of the year. Our goal is to complete piloted transition and enter eIPP operations this year.

[Andres Sheppard, Analyst at Cantor Fitzgerald]

Wonderful. Thank you so much, and congrats again. We'll pass it on.

[Operator]

Thank you. Your next question comes from the line of Edison Yu from Deutsche Bank. Your line is now open.

[Edison Yu, Analyst at Deutsche Bank]

Hey, good afternoon. Thanks for taking our questions. Wanted to ask about the ATC modernization efforts that you cited and the need for it in the U.S. Can you give us a sense what kind of ecosystem you envision for this and sort of what are the roles of the various parties, whether it's some of those partners that you mentioned like Palantir, the airlines, just how the kind of stakeholders, everything kind of comes together to get this ATC modernized?

[Adam Goldstein, Founder and CEO at Archer]

Thanks, Edison. This is a new and really evolving discussion that's taking place right now. The good news is we've been working on our broader AI products, specifically around ATC solutions for several years now. There are lots of different groups that are participating. Palantir, for example, one of our partners, is participating in the SMART program. Whether Palantir wins or not, I think Archer has an opportunity to be part of the modernization effort, as we've already built a lot of tools that I think can add a lot of value. We haven't shown our solutions publicly as it's still a very competitive space, but we do intend to show it pretty soon. More on that to come.

[Edison Yu, Analyst at Deutsche Bank]

Okay. Just on back to the commercial side, I know you talked about scaling and the importance of that. As you kind of do your work and evaluate the manufacturing process, what are you finding to be the biggest bottlenecks, if any? How are you sort of addressing those?

[Adam Goldstein, Founder and CEO at Archer]

Today a lot of our work really has to do with, you know, getting the aircraft through the certification process. You know, we got through the third phase of certification, which was a big deal because completing all that really unlocked our ability to go through now the TIA process. When your means of compliance is not finished, that means you likely have existing issue papers, which are things that you are unwilling to agree to, meaning things that you can't actively solve. When we solved all those and we were able to agree, it really unlocked really our ability to keep, you know, moving through this process and ultimately get through TIA and certification.

[Adam Goldstein, Founder and CEO at Archer]

On the manufacturing front, a lot of the work that we're doing has to do with putting the processes and manufacturing, you know, tools and equipment in place to allow us to scale. We have put in place, you know, as we've been building out this first initial fleet of, you know, eight to 10 aircraft, but ultimately building towards that, 50 aircraft per year, production capacity. We've been working through the tooling to go do that, and really it has to do with the timeline of type certification. Once we get through the certification side, we can really scale our production side. Of course, all this is just trying to balance the eIPP with our own certification flight, test program with the Launch Edition program.

[Edison Yu, Analyst at Deutsche Bank]

Thank you.

[Operator]

Thank you for your questions. Your next question comes from the line of James Kirby from JPMorgan. James, your line is now open.

[James Kirby, Analyst at JPMorgan]

Hey, good afternoon. Thanks for the time. Maybe just following up with the previous questions. You know, you mentioned you've been advancing your work in phase IV for some time now. Do you mind just expanding on that in terms of what milestones are left or what should we be looking for for what remains for progress in that stage?

[Benjamin Lyon, President of Aircraft OEM at Archer]

Sure. This is Benjamin. As we talked about, we just completed Phase 3, and we're deep into Phase 4, and what this really means is we don't have any unsolvable technical challenges and we're deep into execution. Our, while this is not easy, you know, the rules are in place, and we've got our means of compliance done. The next step is really in making sure that all of our certs, which are now materially in final form, working with the FAA in order to get through those administrative processes to get full approval.

[James Kirby, Analyst at JPMorgan]

Okay, that makes sense. I appreciate that. I guess for my second question, there was a House bill that was signed last month in Florida for Vertiport network build-out. Adam, maybe just your thoughts there in terms of the infrastructure build-out needed to align with the eIPP. Is there more needed? How do you expect it to ramp up kind of over the next three years once the eIPP starts?

[Adam Goldstein, Founder and CEO at Archer]

The infrastructure is really going to be, kind of a mix of, you know, public-private partnerships. We've been working on the infrastructure side for several years now. Domestically, we focused on a lot of what turned out to be the eIPP markets, New York, Florida, and then ultimately California.

[Adam Goldstein, Founder and CEO at Archer]

On the New York side, we worked with the Port Authority and then some of the private airports. On the Florida side, we've worked with Related, Hard Rock, and we're targeting from Miami all the way up to West Palm Beach. In California, Los Angeles has been our kind of central focus where we took control of the Hawthorne Airport. We partnered with SoFi Stadium, USC, and then a bunch of the major FBOs ahead of L.A. 2028.

[Adam Goldstein, Founder and CEO at Archer]

You're seeing really this nice mix of groups that are coming into place. As it relates directly to the eIPP, we're still really finalizing a lot of the details with the different cities, with the different specific routes, there's still more to come. What it's really done is really opened up the level of interest, and we've now seen just a lot of folks that want to partner on this side. I think you'll start to see that expand.

[Adam Goldstein, Founder and CEO at Archer]

We've also done a lot of work with BETA in really talking through the charging infrastructure that is gonna be necessary there. I think you'll see the industry come together, the different cities come together, and then public-private partnership come together to build all the infrastructure needed.

[James Kirby, Analyst at JPMorgan]

Okay. Got it. Thank you.

[Operator]

Your next question comes from the line of Austin Moeller from Canaccord Genuity. Austin, your line is now open.

[Austin Moeller, Analyst at Canaccord Genuity]

Hi, good afternoon. Just my first question, can we talk about the restricted type certificate that was issued for the Midnight in the UAE, and what kind of flight tests can be performed under the restricted type certificate, and can that data be fed back to the FAA to facilitate certification in the U.S.?

[Adam Goldstein, Founder and CEO at Archer]

Thanks, Austin. What we've been working on with the UAE has been transitioning Midnight into the Restricted Type Certificate program, and this is just a difference from what we had been previously working on, which was called the Type Certificate. The Restricted Type Certification program is more of an internationally recognized pathway that would allow Midnight to begin limited commercial operations.

[Adam Goldstein, Founder and CEO at Archer]

We are still working through that. This will help us launch accelerate our Launch Edition program in the UAE and allow for early commercial operations in Abu Dhabi, which, you know, we work with Abu Dhabi Aviation to fulfill. Ultimately, what it does is gives us an ability to generate early revenue and early real-world flight experience.

[Austin Moeller, Analyst at Canaccord Genuity]

Okay. I was wondering if you could comment on the opportunity to help improve the aerospace infrastructure with Palantir. Do you see that as providing software or hardware to, or specifically software to the FAA to deconflict airspace, or do you view it more as using eVTOLs as a vector to test these technologies before they're implemented on aircraft nationwide?

[Adam Goldstein, Founder and CEO at Archer]

A lot of this is still new and being worked on, but from the Archer perspective, we've been working on the application layer, so actual software that would be used. We think about this because there's sort of a flywheel that we need to create. We're not just building aircraft. We have to build aircraft that ultimately can scale, and because the air traffic control system is constrained, it will limit what we can do. We want to participate in any way we can. Even if it meant that we are ultimately not generating significant amounts of revenue, it's still really valuable in order to help the larger flywheel of the industry expand.

[Adam Goldstein, Founder and CEO at Archer]

That being said, we do have some very neat products that we've been working on that ultimately I do think will become adopted and can generate significant revenue. We've really focused more on the application layer versus a Palantir of the world that's focusing more on the integration layer.

[Austin Moeller, Analyst at Canaccord Genuity]

That's super helpful. I'll pass it back there. Thank you.

[Operator]

Your next question comes from the line of Savanthi Syth from Raymond James. Your line is now open.

[Savanthi Syth, Analyst at Raymond James]

Hey, good afternoon, everyone. I think this is Edison's question, if I might follow up on. Just curious, how many aircraft have you built with this kind of current configuration, where you're doing, you know, plan to do transitions life as well? Just kind of curious as you launch the eIPP program and you're doing certification as well, like how many aircraft do you expect to need and to have built this year?

[Adam Goldstein, Founder and CEO at Archer]

Thanks, Savi. We have two aircraft that are flying today, and we're still working through that initial fleet of eight to 10 aircraft. Those are gonna be allotted across the cert, flight test program, eIPP, Launch Edition, as well as, you know, we're putting in place the infrastructure to ramp production to up to 50 aircraft per year. It's really a mix of the two.

[Savanthi Syth, Analyst at Raymond James]

Got it. That's helpful. Just another follow-up on the defense side. I know you have some U.S. programs everywhere you're going after. You also have some U.K. I was curious if there's any pacing that we should consider between the U.S. and U.K. programs.

[Tom Muniz, CTO at Archer]

Yeah. Hey, Savi, this is Tom. As you're, you know, aware, there's interest around the world for vehicles like we are developing now with Anduril. There is an active program that the U.K. MOD is working through their kind of procurement process that we're competing for along with Anduril. You know, can't talk about, you know, any details there, but I think it just goes to show that the opportunity is massive. It's not just one country.

[Adam Goldstein, Founder and CEO at Archer]

I'll kind of follow up there as well, Savi. There's new capabilities that have become very clear that the global governments are interested in. As we've identified those new opportunities, it has just become very clear that there is an aircraft that we can build that can meet that need, and it can leverage a lot of the tools, the systems, the supply chain that we've already put in place for the core Midnight aircraft, even though it's a new type of aircraft.

[Adam Goldstein, Founder and CEO at Archer]

That being said, we've taken the Anduril approach, where we are building early ahead of these programs being announced because by the time they get announced, we wanna be in position to win them. As we've gone down that path, what we're building has turned out to be pretty incredible, and that's why we've had a lot of confidence in that this product will become very interesting around the world. You'll have to wait and see what happens. I guess we'll all have to wait and see what happens, but we have a increased level of conviction that the aircraft that we're building is going to have, you know, global demand and become very interesting.

[Savanthi Syth, Analyst at Raymond James]

Appreciate the call. Thank you.

[Operator]

Your next question comes from the line of Amit Dayal from H.C. Wainwright & Co. Your line is now open.

[Amit Dayal, Analyst at H.C. Wainwright & Co.]

Thank you. Greetings, everyone, and congrats on all the progress. Adam, 1 question on the burn for this year. How much of that is going towards, you know, manufacturing preparedness?

[Adam Goldstein, Founder and CEO at Archer]

Thanks, Amit. Let me just give the bigger picture here, and then I'll let Priya provide some more specifics. We are executing a multi-platform strategy across civil and defense. In the defense side, you know, it's a generational product. It's not something that's simply being hybridized, so that does take real investment.

[Adam Goldstein, Founder and CEO at Archer]

The good news is that, you know, we have already obviously invested in a world-class engineering team, infrastructure, testing assets, and we're deploying that across both of our platforms. As our certainty has increased that we will win some of these defense contracts, it's given us the ability to go out there and spend more. The good news is if we do win a defense contract, there will be dollars awarded, which will help offset the spend. If we don't win a defense contract, we will immediately cut the spend. You'll likely see a few quarters of elevated spend, followed by a potential to reduce that from current levels.

[Priya Gupta, Interim CFO at Archer]

Amit, just digging a little bit deeper, right? Specific to the quarter, as you talked about earlier, we're ramping spend in two core areas. Adam talked about our increased spending on the defense platform. On the other one, as you rightly highlighted, right, on the Midnight program. As we're advancing our commercialization efforts, we are increasing our spend in Midnight for the flight test expansion and ramping the production efforts ahead of the operations in eIPP and other launch markets. Again, we expect this elevated levels to be short-lived, and then potentially come down thereafter.

[Amit Dayal, Analyst at H.C. Wainwright & Co.]

Understood. Thank you for that, guys. Just follow-up to that, is there any certification activity going on for the manufacturing facilities that are in place so far?

[Adam Goldstein, Founder and CEO at Archer]

Hey, Amit. Yes, there is. We've been working through the production certificate as well. We will, you know, try to time that as well with our type certificate progress.

[Amit Dayal, Analyst at H.C. Wainwright & Co.]

Got it. Thank you, guys. That's all I have. Appreciate it.

[Operator]

Your next question comes from the line of Chris Pierce from Needham. Your line is now open.

[Chris Pierce, Analyst at Needham]

Oh, hey, just one big picture question and one kind of near-term question. I guess when I hear you guys talk about the defense opportunity, is there a world where in three to five years, Archer is primarily a defense company and the Midnight is sort of I mean, backburner is not the right word, but it's something where you see an opportunity, you're winning, you know, contracts, you're ramping your manufacturing there, and that's a large company, and that's sort of a path? Or will you always sort of wanna work on both these paths because of both opportunities?

[Adam Goldstein, Founder and CEO at Archer]

It's a good question, Chris. From a big picture perspective, I think the opportunity for civil products is substantially larger than the opportunity for defense products because we're talking about, you know, global use by the consumers. The analogy or sort of example I like to give is if you think about selling, you know, a few dozen of aircraft in the top 1,000 markets, you can build or sell, you know, over $100 billion worth of aircraft. That is a pretty, you know, large number to think about. On the defense side, it will be more targeted and it will go to, you know, U.S. allies for specific use cases. I do think that the defense market will ultimately be smaller.

[Adam Goldstein, Founder and CEO at Archer]

That being said, the beauty of the defense market is you can start to deploy some of these aircraft not going through the same type of FAA type certification process, which means it could be faster. You can also start to use advanced materials and advanced processes that can ultimately lead to a better civil product. That's the flywheel that we are trying to create. We're trying to build amazing products that reinforce each other, that ultimately allow for a big market in both. I do think it's the type of thing where we will be involved in both, but ultimately I think the civil products will be bigger.

[Chris Pierce, Analyst at Needham]

Okay. More near term, going back to Savi's question, it sounds like you have the two aircraft now working to build eight more, but you need to keep a certain amount of aircraft, I'm assuming, in, you know, Northern California or in Hawthorne, I guess now. What should we expect for eIPP deployment? Should it be multiple aircraft per site, or will it be more likely one aircraft and maybe more likely flying CTOL cargo? Like what would be, you know, disappointing? What would be, you know, upside surprise? I just want to get a sense of where expectations should be.

[Adam Goldstein, Founder and CEO at Archer]

We are still in talks with the different eIPP markets and partners, and we are waiting to see the different cities and routes that ultimately come to fruition. We are balancing our own certification process against eIPP opportunity, against the Launch Edition opportunity. We are building to be able to support all three of those. We are going to have to weigh those different opportunities. As there is more clarity on it, we will start to give you more detailed information.

[Chris Pierce, Analyst at Needham]

Okay. Thank you and good luck.

[Operator]

Now I would like to turn the call over to Adam for our retail questions. Adam, please go ahead.

[Adam Goldstein, Founder and CEO at Archer]

We received a question that I thought was a bit more personal that might relate to a lot more people, and it was, "I'm a real person who doesn't have an apartment in New York who won't be flying to a house in the Hamptons. How will I be able to use Midnight?" I think it's a great question, and I think it's an important one. This product was not designed for the rich. It was designed for the masses. We are targeting use cases that are applicable to most people. A typical example that we like to give is flying from city center to an airport. I grew up in Tampa, Florida, and it took me an hour to get to the airport.

[Adam Goldstein, Founder and CEO at Archer]

If you're able to fly over the water and fly 150 mi per hour in a straight line, that would be a real shortcut. If I was able to do that at a similar cost of rideshare, that would be an attractive alternative as just another normal guy growing up in Florida. Hopefully you can see yourself in a product like this and know it is made for everyone and not just for the select few. I'll turn back to the operator.

[Operator]

Thank you very much. There are no further questions at this time. I would now like to turn it back to Adam for any closing remarks.

[Adam Goldstein, Founder and CEO at Archer]

Thank you everyone for dialing in and listening to us. We'll talk to you next time.

[Operator]

This concludes today's call. Thank you for attending. You may now disconnect.

Participants

Executives

• Adam Goldstein, Founder and CEO
• Priya Gupta, Interim CFO

Analysts

• Amit Dayal, Analyst at H.C. Wainwright & Co.
• Andres Sheppard, Analyst at Cantor Fitzgerald
• Austin Moeller, Analyst at Canaccord Genuity
• Benjamin Lyon, President of Aircraft OEM at Archer
• Chris Pierce, Analyst at Needham
• Edison Yu, Analyst at Deutsche Bank
• James Kirby, Analyst at JPMorgan
• Kate Kiewel, Head of Investor Relations at Archer
• Savanthi Syth, Analyst at Raymond James
• Tom Muniz, CTO at Archer